34 BULLETIN 1479, U. S. DEPARTMENT OF AGRICULTURE 
two days on which the net of purchases and sales exceeded 5,000,000 
bushels and the price moved in the opposite direction to the net trade. 
The first of these days was May 6, 1925. On that day trader No. 2 
liquidated a long position of 5,600,000 bushels of July wheat. The 
price of July wheat rose 314 cents from the close on May 5 to the close 
on May 6. The explanation, in part at least, of this rise in price in 
the face of unusualiy large individual selling, is to be found in the 
news of the day. Of outstanding importance was the report of export 
sales of. wheat to Spain of 3,500,000 bushels ‘‘resulting in vigorous 
buying of July by a leading seaboard house’’. Firmness in the export 
market and light receipts furnished additional support. 
The other date was January 8, 1926, when trader No. 2 sold 
5,500,000 bushels of May wheat and 1,000,000 bushels of July wheat, 
both sales being largely liquidation of long accounts, while on the 
same date the price moved up 234 cents. On this date a series of 
eh Dokl 5], ie] aoe 
FRICE MIOVELZENWT (MN CENTS 
AN OCRLEASLE 
S 
OL CRLASE- 
Wy 
; y IR 
SOLD BOUGHT 
SULLIONS OF BUSHELS 
Fic. 7.—Dot chart showing the relation between net purchases or sales aggregating 2,000,000 bushels or 
over and net price changes, in the 1926 May wheat future 
market factors combined to support the price. Cash grain premiums 
increased, good demand for spot offerings, Liverpool cables not as 
weak as expected, and reports indicating a smaller crop in Argentina 
were factors of varying weight. How much these factors contributed 
to the upward movement in price is difficult to state. January 8 fol- 
lowed a four day recession in price from a high on January 4, of $1.8314 
to a low on January 8, of $1.7534. This decline in itself undoubtedly 
encouraged buying support in considerable volume by that large 
army of small speculators continually trying and being encouraged 
to buy on minor ‘‘breaks”’ and sell out on an advance of a few cents. 
To illustrate quantitatively the degree of correspondence between 
large net trades and price, Figure 7 has been prepared. This chart 
shows the thirty-three ‘‘2,000,000-bushel-or-over”’ days in the 1926 
May wheat future with the corresponding price change for each day. 
If the price changes in each of the 33 cases bore a direct and pro- 
